Casualties Of War: OfferPal Downsizes As Facebook Chooses Competitor

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Facebook is steadily converting partners like Zynga away from their home grown payment product to Facebook Credits. And to date there’s just one alternative for users who want to complete offers like getting a Netflix subscribtion in exchange for Farmville credits, or whatever – Trialpay. Offerpal, one of the largest offer providers, is responding to that decision. With layoffs.

In an open letter to be published later today, Offerpal CEO George Garrick talks about the reasons behind the downsizing, and the company’s new focus on other platforms:

As most of you probably know, Facebook has launched Facebook Credits, and certain Facebook games and applications have or will transition from their proprietary currencies to FB Credits.

Facebook has indicated to us that at least initially they have selected another provider to be their alt-pay partner for purchases of Facebook Credits. We respect this decision, maintain a good working relationship with Facebook, and will do our best to facilitate the smoothest possible transition for those games which move to the Credits system. However, this means that for the applications we currently serve which do switch to Credits, once that change happens the user traffic to those games that originates from Facebook will no longer be served by Offerpal.

We will continue to fully support Facebook applications which do not switch to Credits, we will as I mentioned do our best to ensure the smoothest possible transition for those applications which do switch, and we will continue to serve our valued developer partners on other Internet platforms and destination sites as well as on mobile platforms.

But like any good business, we must balance our costs with our revenues by business area. This means that we must downsize our Facebook operations in order to adjust to an anticipated lower scale of Facebook user traffic, while we also re-focus our resources on our growth areas including other gaming platforms, open web gaming, new Internet verticals, and most importantly mobile through our Tapjoy subsidiary.

Unfortunately, as a result of this, some of the outstanding people who have worked tirelessly over the last couple of years to monetize Facebook games will have their positions at Offerpal eliminated. I thank them for their dedication, effort and contribution, and will do whatever I can to help them find exciting new career opportunities.

Meanwhile, Offerpal is currently the largest offers and alt-pay provider world-wide. Offerpal’s business continues to grow and expand in numerous other areas including an exciting new agreement with Yahoo!, and on the mobile iPhone, iPad and Android platforms, with more to come. We are projecting continued strong growth going forward as well as sustained profitability.

Finally, we would like to thank our 2,000+ developer partners for their continuing support of Offerpal and we look forward to continuing to work with all of you as we collectively grow our exciting new industry.